Signaling networks have increasinglyemerged as the ruling principlein the control of complex biological processes. Cell proliferation and differentiation duringnormal development and tumor progression are regulated by multiple interacting signaling pathways, and it appears that specific biological responses often arise as the consequence of such interactions. Understandingthe basic rules and the context in which these pathways interact thus has become a fundamental challenge for basic and cancer biology. In the following proposal we will use Drosophila as a highly genetically tractable in vivo model system to explore signaling network architecture and function. As a specific example, we will investigate the functionally important interactions between the epidermal growth factor receptor (EGFR) and transforming growth factor-6 (TGF6) pathways found in many developmental and pathological situations such as cell fate determination, differentiation, and tumor metastasis. In particular,we will study their interactions in controlling cell differentiation of Drosophila wing vein cells (a type of specialized epithelial cells). Our recent studies and those of others suggest that the two pathways not only upregulateeach other's activities but are also both required for vein cell differentiation.In this proposal, we will focus on investigatinghow the EGFR and Dpp (a Drosophila homolog of TGF8) pathways reciprocallyaffect each other's activities and how they act together to instructtissue differentiation. In this research proposal, we will test three main hypotheses: (1) the cell-autonomous EGFR-Dpp positive-feedback signalingcycle converts a transient and reversiblesignaling pathway activation to a self-sustainable and lasting "active state" of both pathways, which induces and maintains the irreversible process of cell differentiation,its coordination with cell cycle regulation, and the establishment of lateral inhibition, (2) the biological effects of the EGFR-Dpp signaling cycle are achieved in part by combinatorial transcription regulation of specific target genes, and (3) lateral inhibition by the Notch pathway is mediated via inhibitionof the EGFR-Dpp cycle in intervein cells. Results from the proposed research will elucidate a novel mechanism of signalingcrosstalk between the EGFR and Dpp pathways in a developmental context and should shed light on how these two signaling pathways cooperate in a variety of normal developmental as well as pathological situations such as tumor metastasis.